Housing Options Bryce Hagen Gamal Burhum Vesna Eng Danny Luu Team 11
Buy a Used Home or Build a New Home A Comparison Based On Financial Conclusions
Scenario Typical College Graduate First Time Home Buyer Southern California Residence Good Credit $300, Budget 5.2% 30 Year Loan Sell The Home After 10 Years
Assumtions 3.45% Inflation 10.0% Real Estate Return 10 year Analysis
Used House Location 2408 Ogden St. San Bernardino, CA
Used House Details 3 Bedrooms, 2 Bathrooms Family Room, Dining Room, Living Room 2 Car Garage 1396 Square Foot House 8700 Square Foot Lot Built in 1966 $249,900.00
New House Lot Location 2620 Kern St San Bernardino, CA
New House Details 1400 Square Foot House Built in 2004 9330 Square Foot Lot 3 Bedrooms, 2 Bathrooms Dining Room, Living Room, Family Room 2 car Garage Lot - $26,500.00
Used House Initial Costs $249, Purchase Price $ Closing Costs $ Advance Payments $ Title Charges $ Miscellaneous $257, Total Initial Cost Sell the Home in 10 Years for $650,000.00
New House Costs $26, Lot Price $196, Const. Costs $16, Month Rent $8, Fees $5, Architect $253, Total Initial Costs Sell the Home in 10 years for $720,000.00
Used Home Maintenance Costs $1,000 / year Maintenance $9,500 Year 2,4 Plumbing Cost $1,500 Year 3, Water Heater $7,500 Year 1, New Roof
New Home Maintenance Costs $0 for the First 10 Years
Present Worth Comparison - $336, Total Costs $277, PW of Sale - $59, PWC New Home - $370, Total Costs $250, PW of Sale -$119, PWC Used Home
Sensitivity Analysis Increased Construction Costs $110 - $200 Sq Ft
Sensitivity Analysis Change in Used Home Price $200k – 270k
Internet Resources – Home Building Tips and Warnings – Instructions for Building and Contracting – Present Worth Analysis
Buy a Used Home or Build a New Home Any Questions?